Overview

• U.S. digital game developer's Q1 revenue rose 35.7% yr/yr on ARK and Bellwright sales

• Company posted net income of $2.1 mln, up from a loss last year

• Q1 EBITDA rose to $2.4 mln from a loss a year earlier

Outlook

• Company expects year-over-year growth in Q2, driven by upcoming ARK content releases

• Snail expects to recognize about $11 mln deferred revenue upon Genesis Part 1 release

• Company sees next 12-18 months as an inflection period with ARK pipeline and new titles

Result Drivers

• ASA AND BELLWRIGHT SALES - Co said higher revenue was mainly due to increased sales of ARK: Survival Ascended and Bellwright

• DEFERRED REVENUE RECOGNITION - Co said $2.5 mln increase in deferred revenue recognized during the period contributed to revenue growth

• SALES PROMOTIONS AND DLC MOMENTUM - Co attributed higher bookings to better sales promotions, tailwind from ARK: Lost Colony DLC, and Bellwright content update

Company press release: ID:nGNX71HhBM

Key Details

Metric	Beat/Miss	Actual	Consensus Estimate
Q1 Revenue	Beat	$27.3 mln	$18 mln (1 Analyst)
Q1 Net Income		$2.1 mln
Q1 EBITDA		$2.4 mln

Analyst Coverage

• The one available analyst rating on the shares is "buy"

• The average consensus recommendation for the software peer group is "buy"

• Wall Street's median 12-month price target for Snail Inc is $3.50, about 596.5% above its May 12 closing price of $0.50

• The stock recently traded at 5 times the next 12-month earnings vs. a P/E of 6 three months ago

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